PTA devises regulations to allow telcos to trade spectrums

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ISLAMABAD, Nov 9 (APP): Pakistan Telecommunication Authority (PTA) has devised a Spectrum Trading Framework to allow markets to determine the best use of spectrum and asked all stakeholders to provide their input/comments by December 5.
The goal of Telecom Policy 2015 with reference to spectrum is “allocation and assignment of spectrum to maximize social and economic benefits derived from use of this scarce resource.”
Section 8.15 of Telecom Policy 2015 deals with subject of spectrum trading, and states that spectrum trading will be permitted under specific conditions.
A documents available with APP has revealed that spectrum trading occurs through outright sale of rights and obligations or term lease, subject to license conditions and approval by PTA/Pakistan Electronic Media Regulatory Authority (PEMRA) under intimation to Frequency Allocation Board (FAB).
The policy further stares that a Spectrum Trading Framework will be developed by the PTA, PEMRA and FAB, and will be subject to policy level approval by Federal Government (Ministry of Information Technology (MoIT).
The factors like spectrum capping shall be considered while developing such framework.
In relation to trading, the document said seller will be expected to pay a trading fee or processing fee and any other applicable fee will be levied to cover re-issuing of licenses.
The decision to trade is a commercial decision for the license holder. The terms of the trade will be a commercial agreement between licensees.
Spectrum will be traded only if the relevant license that contains the spectrum assignment to be traded, permits trading. Spectrum assigned to a licensee without such a permit will not be traded unless Federal Government (MoIT) specifically authorizes the trade as being in public interest.
Nevertheless, spectrum trading will be permitted only for spectrum that has been acquired through a pricing arrangement that represents its market value (i.e. auction or AIP).
Spectrum subject to Administrative Cost Recovery or other forms of nominal pricing will not be traded.
According to the policy, spectrum may be traded between holders of the same license type only. For example, spectrum trading may take place between Local Loop (LL) licensees or mobile licensees but not between an LL licensee and a mobile licensee to maintain basic value of different categories of spectrum.
Spectrum will not be traded by any licensee with the necessary license conditions until the licensee has fulfilled its payment and roll out obligations unless it also transfers its roll out obligations with trade and same is verified and authorized by PTA.
The eligibility for receiving spectrum through a trade will be the same as eligibility for assignment of spectrum by FAB. The acquirer of spectrum will be required to obtain (or already hold) the appropriate telecommunications license and to meet the terms of that license.
The framework for spectrum trading will take into account the effects of such trading on competition, national security, public health and safety, compliance with the national laws and policies and compliance with international obligations and international relations.
Swapping of spectrum will be considered as a two-way spectrum trade subject to approval by PTA and FAB.
The forms of spectrum trading to be permissible under this framework include: Spectrum will be traded only if the relevant license that contains the spectrum assignment to be traded, permits trading. Spectrum assigned to a licensee without such a permit will not be traded unless Federal Government (MoIT) specifically authorizes the trade as being in the public interest.
Spectrum trading will be permitted only for spectrum that has been acquired through a pricing arrangement that represents its market value (i.e. auction or AIP). Spectrum subject to Administrative Cost Recovery or other forms of nominal pricing will not be traded.
Spectrum may be traded between holders of the same license type only. For example, spectrum trading may take place between Wireless Local Loop (WLL) licensees or mobile licensees but not between a WLL licensee and a mobile licensee.
Outright sale of the rights and obligations (Transfer) : The license spectrum holders may transfer all of their license rights and associated obligations to another party who will also be the valid licensee of the same category. Transfers will be of two types permanent, till the remaining term of applicant licensee; or time-limited.
A time-limited transfer shall involve reversal of the original transaction by the transferee after the expiry of the time involved. Both parties will enter into contract agreement to be submitted to PTA at the time of application. With an outright or total transfer, the rights and obligations of the transferor will become now the rights and obligations of the transferee. After such a transfer, the original licensee (transferor) will no longer have any rights and/or obligations under the traded license to the extent of traded spectrum.
Regarding Spectrum Leasing, the document said leasing is administered by license terms and conditions. A license-holder may grant leases only if the license contains the necessary terms and conditions as provided in this framework. After modification of the license conditions, the licensed spectrum holder shall become eligible to enter into a contract to let someone else to exercise its rights to use the spectrum. With spectrum leasing, the rights and obligations of the transferor will become the rights and obligations of the transferee for the period of lease.
After such a transfer, the original licensee (transferor) will no longer have any rights and/or obligations under the traded license to the extent of traded spectrum for the lease period.
Similarly, with regard to spectrum swapping, the documents said it is a two-way spectrum trade between both spectrum licensed holders subject to approval by PTA and FAB.
Interested parties will apply to PTA, under intimation to FAB, on a prescribed form seeking permission for either category of spectrum trading.